04/04/2008 - 10:52

Portman snaps up 10pc Golden West stake

04/04/2008 - 10:52

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Shares in takeover target Golden West Resources Ltd have soared over 70 per cent after it was revealed iron ore mining company Portman Ltd had acquired a 10 per cent stake while its bidder Fairstar Resources discloses its position in the Opes Prime saga.

Portman snaps up 10pc Golden West stake

Shares in takeover target Golden West Resources Ltd have soared over 70 per cent after it was revealed iron ore mining company Portman Ltd had acquired a 10 per cent stake, while its bidder Fairstar Resources disclosed its position in the Opes Prime saga.

Golden West emerged from a two-day trading halt this morning with its share price rocketing to $1.66 before settling at $1.465 at time of writing - a jump of nearly 52 per cent.

The company said it had been advised by Fairstar that 10 million shares it was entitled to in its takeover bid for Golden West were now held by ANZ Nominees Ltd pursuant to an arrangement with Opes Prime.

In a separate announcement, Fairstar said it had pledged the 10 million shares to ANZ Nominees on behalf of Opes Prime, as security to a $3.3 million loan. The loan was to assist with working capital, fund exploration and to participate in Golden West's pro-rata share issue.

The loan currently stands at $1.8 million.

"Fairstar maintains that it has retained beneficial ownership of these GWR shares because it is not in default under the Opes Prime facility," the company said in a statement.

"As a result, no third party has the right, as against Fairstar, to dispose of the GWR shares. However, it appears that Opes Prime is claiming that it has beneficial ownership of these shares, and based on the volume trading in GWR on 1 and 2 April 2008, it is possible these shares have already been disposed of by ANZ Nominees."

Fairstar said it was pursuing legal action to have the 10 million shares returned to it, but conceded the outcome of that would not be known for some time.

Golden West had called a trading halt on Wednesday after some 14 million shares were traded. Prior to that it said over 4 million Golden West shares were traded on Tuesday.

It is believed the 10 million shares may have been offloaded during this time.

Portman revealed this morning it was the owner of 11 million Golden West shares, representing 10 per cent of the Golden West.

Portman operates the Koolyanobbing iron ore mine in WA which currently transports its ore to the Esperance Port for shipping.

In its scoping study, Golden West also looked into the option of exporting ore through Esperance, with rail and port costs for the route totalling $25 per tonne on a production rate of 10 million tonnes per annum, as announced last year.

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